Enghouse Systems

A software company that has been pretty aggressive on growth through acquisition, using their relatively highly valued equity paper to buy all these small companies, roll them in, and get synergies. Software in general is becoming a much more competitive from an M&A standpoint, so it is going to be harder to find cheap deals. Also, it is not the cheapest stock. He is not interested in this.

A software company that has been pretty aggressive on growth through acquisition, using their relatively highly valued equity paper to buy all these small companies, roll them in, and get synergies. Software in general is becoming a much more competitive from an M&A standpoint, so it is going to be harder to find cheap deals. Also, it is not the cheapest stock. He is not interested in this.

Doesn’t follow this closely. The price has come down quite a bit. A software company that have been growing primarily through acquisitions. Thinks Amazon (AMZN-Q) has indicated they are going to enter into the same software market, and some analysts have indicated the space is going to get more competitive. A high multiple stock to begin with, and is not considered inexpensive.

Doesn’t follow this closely. The price has come down quite a bit. A software company that have been growing primarily through acquisitions. Thinks Amazon (AMZN-Q) has indicated they are going to enter into the same software market, and some analysts have indicated the space is going to get more competitive. A high multiple stock to begin with, and is not considered inexpensive.

RBC left a buy on the stock after issuing a terrible report on this company. AMZN-Q has said it will offer similar software to ENGH-T. That is the negative story. But she does not think it will make much difference in the short run. Don’t write them off.

RBC left a buy on the stock after issuing a terrible report on this company. AMZN-Q has said it will offer similar software to ENGH-T. That is the negative story. But she does not think it will make much difference in the short run. Don’t write them off.

This has been a very successful company over the last number of years. It is a growth through acquisition type of model, buying a bunch of small software companies, cutting out the costs, and trying to put it together in a bigger rollup strategy. It has always been expensive.

This has been a very successful company over the last number of years. It is a growth through acquisition type of model, buying a bunch of small software companies, cutting out the costs, and trying to put it together in a bigger rollup strategy. It has always been expensive.

A sideways trading stock, but there is not a lot of downside unless it breaks $50. Also, there is not a lot of upside, beyond $55 maybe. If you can make 10%, 12%, 15% on every trade over and over, this is a no-brainer. For a “buy and hold” investor, he would probably avoid this stock.

A sideways trading stock, but there is not a lot of downside unless it breaks $50. Also, there is not a lot of upside, beyond $55 maybe. If you can make 10%, 12%, 15% on every trade over and over, this is a no-brainer. For a “buy and hold” investor, he would probably avoid this stock.

Essentially a consolidator of software companies. Think of it as a smaller/younger version of Constellation Software (CSU-T), but trading at a little bit lower multiples. Like Constellation they have had a rough 2016. Likes the name, but probably prefers Descarte (DSG-T) in the sector. They have proven to be relatively disciplined as an acquirer. Not a bad name to hold as a long-term investment.

Essentially a consolidator of software companies. Think of it as a smaller/younger version of Constellation Software (CSU-T), but trading at a little bit lower multiples. Like Constellation they have had a rough 2016. Likes the name, but probably prefers Descarte (DSG-T) in the sector. They have proven to be relatively disciplined as an acquirer. Not a bad name to hold as a long-term investment.

This has done well, but the stock has pulled back because of recent negative earnings surprise. However, it still ranks at 50 out of 700 stocks, being in the top 10%. PE on a trailing basis is not cheap at 35X earnings, compared to 13% earnings growth. The stock looks expensive. This typically grows by acquisition.

This has done well, but the stock has pulled back because of recent negative earnings surprise. However, it still ranks at 50 out of 700 stocks, being in the top 10%. PE on a trailing basis is not cheap at 35X earnings, compared to 13% earnings growth. The stock looks expensive. This typically grows by acquisition.

Sold his holdings, not because there was anything wrong with the business, but the stock just got expensive in relation to its growth rate. The stock is looking pretty rich. Fundamentally it is a great company and he thinks you will still make money on the stock. This is a Hold, but if it goes lower it would be a Buy.

Sold his holdings, not because there was anything wrong with the business, but the stock just got expensive in relation to its growth rate. The stock is looking pretty rich. Fundamentally it is a great company and he thinks you will still make money on the stock. This is a Hold, but if it goes lower it would be a Buy.

How is this as a long-term (3+ years) hold? Just did a transaction which was one of the larger ones in their history. They continue to do roll ups and they see some organic growth every time they do the roll up. There is probably good growth ahead of it in the 3 year timeframe. In the short term, the one issue is valuation. Not cheap.

How is this as a long-term (3+ years) hold? Just did a transaction which was one of the larger ones in their history. They continue to do roll ups and they see some organic growth every time they do the roll up. There is probably good growth ahead of it in the 3 year timeframe. In the short term, the one issue is valuation. Not cheap.

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